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Video Conferencing: Beyond the Boardroom
Thanks to widespread government patronage as well as a massive retail boom, videoconferencing is no more the prerogative of corporates
Minu Sirsalewala
Tuesday, July 25, 2006

Videoconferencing as a technology has now started moving out of conference rooms, where it used to sit traditionally. The industry is now taking its first steps from group systems to desktop videoconferencing systems. Apart from large enterprises, small and medium enterprises are adopting videoconferencing solutions.

In FY 2005-06 the videoconferencing market size was at Rs 65.6 crore against Rs 28.8 crore in 2004-05 and is likely to grow at a CAGR of 24.9% till 2011. There is a growth explosion expected (30% for the next two years) in the medium-term, beyond which growth rates will stabilize at 22%.

There was a gradual shift from audio meetings to web conferencing and desktop video

Videoconferences moved beyond corporates; the perceptible retail boom owed much to the efforts of the Reliance WebWorlds.

The government administrative sector, judiciary, distance learning, and telemedicine drove adoption across the country

Polycom still ruled though other players such as Tandberg, Aethra, and Actis started making their mark

Vendor Stories
Polycom has a 59.5% market share in videoconferencing endpoint segment at Rs 39 crore followed by Tandberg with revenue of Rs 10 crore. Aethra distributed by Siemens stood at 4.6 crore. Actis, a new entrant in the videoconferencing space made around 4 crore from their sales.

Other players such as Sony, VCON, D-Link, and Samsung  make 12.2% of market share. The widespread popularity of distance learning and growing economy coupled with a stronger thrust on e-governance has made India a promising market for videoconferencing equipment. Siemens distributed Aethra and Polycom conferencing solutions; and its major deployment for RBI this year at around 46 locations.

Polycom has grown four times in the past three years. In terms of sales, Polycom registered much better growth than the industry. Apollo Hospitals, MKCL, Mumbai Jails, Tele-Vital, and Andhra Jail are some of their customers in India. Andhra Jails have adopted videoconferencing for the trials are conducted on a regular basis ensuring safety of the inmate as well as of the general public and also saving on transportation costs.

Targeting the corporate and government sectors, Polycom has aligned their channel and distribution strategy to reach out to the SMB and SOHO segments and chalked out a two-pronged retail strategy to make inroads into this segment.

Actis managed to garner a share of 6.1% at Rs 4 crore and plan to increase it to 15% in the coming year.  For Actis, the year 2005 was significant as they were able to venture into the use of videoconferencing such as telemedicine and distance learning.

Few of the major clients for Actis last year were SBI, General Atlantic Partner, Lehman Brothers, Mahindra & Mahindra, Welingkar Institute of Management, and  Cushman and Wakefield.

Actis has set up offices in New Delhi and Pune and has increased their channel network across India, having a channel base of more than 500 members.

The Usage Pattern
Enterprises today, are looking forward to leading edge technology, flexible conferences, flexible deployment, common management suites, highly scalable solutions, secure VoIP conferencing, embedded multipoint options, and more in videoconferencing solutions.

How they Stacked up

Vendors

2004-05
Revenue
(Rs crore)

2005-06
Revenue
(Rs crore)

Polycom

18.6

39.0

Tandberg

5.9

10.0

Aethra

1.2

4.6

Actis

NA

4.0

VCON

0.6

2.0

Others

2.5

6.0

Total

28.8

65.6

Source: DQ estimates CyberMedia Research
Polycom remained the numero uno, and Tandberg maintained its number two slot. Actis, the new kid on the block is the one to watch out for

Videoconferencing therefore, spells power of integration, bringing within reach some inherent advantages. The system can be used for scheduled or adhoc meetings and plays a crucial role in enhancing productivity. This in the long run, is extremely important for swift analysis and decision making, bringing products to the market, and gaining an edge over competitors.

The advent of broadband and the growth of the BPO industry have driven the deployment of Web conferencing in the country.

In 2005, there's been a significant increase in the adoption of Web conferencing in the enterprise market. Emerging businesses will increase the adoption of this service as prices of hardware and bandwidth fall, and awareness about the technology spreads in the market.

Even small cities such as Amritsar, Hoshiarpur, Bhatinda, Barnala, and Malerkotla could not resist the lure of IT.

Videoconferencing (Web) in these cities clearly shows that this service is not restricted to big cities and corporate clients only. Though this service is in its infancy in smaller cities, with time it will gain popularity. Presently, Reliance Infocomm is the only player in Punjab, offering videoconferencing facilities through its Web Worlds. Seeing the potential, even Connect from HFCL is planning to venture into the service.

Also, for legal and judicial purposes, where recently, Reliance WebWorld, hosted a videoconferencing-where a subject expert in UK was consulted by a judge and a panel of advocates sitting here in Chandigarh. Such instances are gaining popularity.

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